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Property sellers at two year low

Property sellers at two year low

Category: Mortgages

Updated: 17/01/2011
First Published: 17/01/2011

MONEYFACTS ARCHIVE
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Property asking prices increased for the first time in three months in January, as the number of new sellers hit a two year low.

The volume of properties coming to market dropped to its lowest level since January 2009 during the month, but allowed new sellers to increase their asking prices by 0.3%, the equivalent of £711.

It means that asking prices rose from £222,410 in December to £223,121, according to Rightmove.

A jump in asking prices at the beginning of a new year is not uncommon, as sellers feel more optimistic about the prospects for their properties.

There was also a 0.4% rise last year, although falls of 0.8% and 1.9% were recorded in 2008 and 2009 respectively after the collapses of Northern Rock and Lehmann Brothers.

The slight rise is the first upward motion in the market for three months and brings an end to a run of five price falls in six months.

Coinciding with the run into the spring moving season, Miles Shipside, director of the property website, said he expects the lack of properties coming to market to assist an upward trend in asking prices for the next three months.

"The opening skirmish in the 2011 price battle looks to be going marginally in favour of scarcer sellers, especially in locations preferred by tooled-up cash buyers or those packing a hefty deposit," he added.

However, the housing market remains thin and open to volatility, it has been warned.

While popular areas continue to hold their value, less desirable locations are feeling the effects of a lack of willing and able buyers.

As such, a 1% annual fall has been recorded for flats, terraced properties and semi-detached homes, while asking prices for detached houses have increased by 1.6%.

"Those areas and property types coveted by mortgage-ready buyers are likely to experience a supply famine that will help underpin their prices this spring," said Mr Shipside.

"Wherever those deposit-rich choose not to wander, the on-going mortgage famine will ensure sellers in those areas will remain buyer-hungry and will continue to see downward price pressure."

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